Advanced Drainage Systems, Inc. (WMS) has reported a 92.24 percent jump in profit for the quarter ended Sep. 30, 2016. The company has earned $23.73 million, or $0.38 a share in the quarter, compared with $12.35 million, or $0.19 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $25.68 million, or $0.35 a share compared with $15.47 million or $0.21 a share, a year ago.
Revenue during the quarter dropped 5.88 percent to $360.78 million from $383.33 million in the previous year period. Gross margin for the quarter expanded 251 basis points over the previous year period to 25.09 percent. Total expenses were 88.01 percent of quarterly revenues, down from 90.71 percent for the same period last year. This has led to an improvement of 270 basis points in operating margin to 11.99 percent.
Operating income for the quarter was $43.26 million, compared with $35.63 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $65.60 million compared with $63.74 million in the prior year period. At the same time, adjusted EBITDA margin improved 156 basis points in the quarter to 18.18 percent from 16.63 percent in the last year period.
Joe Chlapaty, chairman and chief executive officer of ADS commented, "We are pleased with our success in managing our costs and operations amidst soft market conditions. Second quarter net sales declined as expected due to relatively flat core domestic construction growth and continued weakness in Mexico and the agriculture market. Despite the market conditions, we were still able to improve our gross margins, Adjusted EBITDA and cash flow. Free cash flow generation should remain strong in the second half of fiscal 2017, which will provide us additional avenues to create shareholder value including investing in our business, making selective acquisitions and returning cash to our shareholders."
For financial year 2017, Advanced Drainage Systems, Inc. projects revenue to be in the range of $1,225 million to $1,250 million .
Operating cash flow improves significantly
Advanced Drainage Systems, Inc. has generated cash of $45.58 million from operating activities during the first half, up 169.30 percent or $28.65 million, when compared with the last year period.
The company has spent $24.42 million cash to meet investing activities during the first six months as against cash outgo of $25.10 million in the last year period.
The company has spent $18.81 million cash to carry out financing activities during the first six months as against cash inflow of $7.67 million in the last year period.
Cash and cash equivalents stood at stood at $8.80 million as at Sep. 30, 2016.
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